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Solar Dilemma: How Much Could Hoku Fetch In Sale? (HOKU)
Hoku Scientific, Inc. (NASDAQ:HOKU – News) has been looking for additional finding for its wholly-owned unit Hoku Materials, Inc. This was established to manufacture and sell polysilicon for the solar market. The company said late Friday that it is in discussions with several strategic and financial investors regarding debt and equity financing, but it expects it will need a few months to work through its options. More importantly, the company has hired Deutsche Bank Securities as its financial advisor to seek a possible sale of the company.
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Solarfun Renegotiates Hoku Payments (SOLF, HOKU)
A US-based subsidiary of Hoku Scientific, Inc. (NASDAQ:HOKU) and a Hong Kong-based subsidiary of Solarfun Power Holdings Co., Ltd. (NASDAQ:SOLF) have renegotiated a polysilicon supply contract between Hoku and Solarfun. The renegotiation affects only the timing of payments and deliveries, not the price, volume or other material items in the agreement.
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Alternative Energy Short Selling Decreases (CSIQ, CPST, CLNE, ENER, ESLR, FSLR, FCEL, SOLR, HOKU, JASO, SFUN, SPWRA, SPWRB)
Short selling is not always just used as a bet against a stock, but that is what Wall Street evaluates short interest for. We did note a drop in short selling on NASDAQ from mid-December to December 31. But it is odd that short selling in alternative energy stocks has come down too. this is despite how weak some of the alternative energy stocks have been and how the industry is being gutted by sudden cheap energy prices again.
Stock (Ticker) Dec. 31 Dec. 15 Change
Canadian Solar Inc. (CSIQ) 2,221,041 2,535,153 -12.39%
Capstone Turbine Corp. (CPST) 15,238,501 15,982,879 -4.66%
Clean Energy Fuels Corp. (CLNE) 3,766,746 3,363,349 +11.99%
Energy Conversion Devices (ENER) 10,903,594 11,784,508 -7.48%
Evergreen Solar, Inc. (ESLR) 23,030,783 24,041,949 -4.21%
First Solar, Inc. (FSLR) 7,586,475 7,725,457 -1.80%
FuelCell Energy, Inc. (FCEL) 5,844,014 6,821,520 -14.33%
GT Solar International (SOLR) 2,588,190 2,585,455 +0.11%
Hoku Scientific, Inc. (HOKU) 1,912,737 2,012,192 -4.94%
JA Solar Holdings, Co. (JASO) 14,182,231 15,976,615 -11.23%
Solarfun Power Holdings Co. (SFUN) 3,027,631 3,948,622 -23.32%
SunPower Corp. (A) (SPWRA) 9,418,472 9,619,152 -2.09%
SunPower Corp. (B) (SPWRB) 2,521,597 2,618,116 -3.69%
Jon C. Ogg
January 13, 2009
Short Seller Surprise, Alternative Energy Mixed Bag (CSIQ, CPST, CLNE, ENER, ESLR, FSLR, FCEL, SOLR, HOKU, JASO, SFUN, SPWRA, SPWRB)
With oil tanking, many alternative energy stocks and solar stocks have been paying for it. They were the leveraged winners when oil was running up and now they are paying the price on the way down. You will see some major increases in the short selling in some of the key stocks, but it is amazing just how mixed the bets are with some seeing real drops in the short interest. Maybe the notion is out that with suddenly super-low P/E ratios and with many off 75% or more that the worst is behind:
Stock (Ticker) NOV. 28 NOV. 14 CHANGE
Canadian Solar Inc. (CSIQ) 2,427,370 3,368,857 -27.95%
Capstone Turbine Corp. (CPST) 17,560,127 18,493,021 -5.04%
Clean Energy Fuels Corp. (CLNE) 3,410,178 3,278,222 +4.03%
Energy Conversion Devices (ENER) 12,318,601 11,092,675 +11.05%
Evergreen Solar, Inc. (ESLR) 24,902,180 25,732,337 -3.23%
First Solar, Inc. (FSLR) 9,307,012 7,074,475 +31.56%
FuelCell Energy, Inc. (FCEL) 9,091,358 9,447,180 -3.77%
GT Solar International (SOLR) 2,614,025 2,092,142 +24.94%
Hoku Scientific, Inc. (HOKU) 2,040,200 2,442,894 -16.48%
JA Solar Holdings, Co. (JASO) 18,283,207 16,661,472 +9.73%
Solarfun Power Holdings Co. (SFUN) 5,003,987 5,249,784 -4.68%
SunPower Corp. (A) (SPWRA) 11,114,809 12,210,305 -8.97%
SunPower Corp. (B) (SPWRB) 3,230,046 1,990,460 +62.28%
Jon C. Ogg
December 10, 2008
Short Sellers Losing Conviction in Alternative Energy (CSIQ, CPST, CLNE, ESLR, FSLR, FTEK, FCEL, HOKU, LDK, SPWR, STP)
Many traders and short sellers have loved targeting solar power and other alternative energy stocks. Interestingly, bets against these companies have not risen dramatically even though many of them are under pressure from falling energy and commodities prices. As you will see below, there was only one company with a significant rise in short interest.
Top Pre-Market Analyst Upgrades (ACE, NLY, ESLR, GFIG, HOKU, ITG, GS, KR, MON, NDAQ, TRV)
These are some of the positive calls and upgrades we have seen from analysts this morning:
- ACE Ltd. (ACE) raised to buy at Goldman Sachs.
- Annaly Capital (NLY) raised to overweight at JPMorgan.
- Evergreen Solar (ESLR) raised to hold at Citigroup.
- GFI Group (GFIG) raised to outperform at KBW.
- Hoku Scientific (HOKU) raised to buy at Broadpoint.
- Investment Technology Group (ITG) raised to outperform at KBW.
- Goldman Sachs (GS) raised to outperform at Wachovia.
- Kroger (KR) raised to buy at B of A.
- Monsanto (MON) raised to buy at BB&T.
- NASDAQ OMX (NDAQ) raised to outperform at KBW.
- Travelers (TRV) raised to buy at Goldman Sachs.
Jon C. Ogg
September 17, 2008
Short Seller Changes in Alternative Energy (CSIQ, CPST, CLNE, ESLR, FSLR, FTEK, FCEL, HOKU, LDK, SPWR)
Many traders and short sellers have loved targeting solar power and other alternative energy stocks. What is interesting is that the bets against these companies did not show a larger increase since many of them have been under pressure from falling energy and commodities prices..
Alternative Energy Aug 29 Aug 15 Change
Canadian Solar Inc. (CSIQ) 4,792,383 4,105,862 16.72%
Capstone Turbine Corp. (CPST) 26,868,541 27,148,261 -1.03%
Clean Energy Fuels Corp. (CLNE) 3,157,778 3,370,936 -6.32%
Evergreen Solar, Inc. (ESLR) 29,577,222 28,600,712 3.41%
First Solar, Inc. (FSLR) 4,118,065 3,932,851 4.71%
Fuel Tech, Inc. (FTEK) 8,967,558 9,409,720 -4.70%
FuelCell Energy (FCEL) 13,231,020 13,547,382 -2.34%
Hoku Scientific (HOKU) 3,408,545 3,264,070 4.43%
LDK Solar Co. Inc. (LDK) 12,810,785 14,263,002 -10.18%
SunPower Corporation (SPWR) 18,696,656 18,939,191 -1.28%
Jon C. Ogg
September 11, 2008
Hoku Scores Another Substantial Supply Pact (HOKU)
Hoku Scientific, Inc. (NASDAQ: HOKU) has just announced that its Hoku Materials subsidiary and Tianwei New Energy (Chengdu) Wafer Co., Ltd. have signed a definitive contract for Hoku’s sale and delivery of polysilicon to Tianwei over a ten-year period beginning in early 2010. The company said that $284 million may be payable to Hoku during the ten-year period of this contract, subject to product deliveries and other conditions.
Short Sellers Still Target Solar Stocks (FSLR, SPWR, ESLR, CSIQ, AKNS, HOKU)
These are not all of the solar stocks we cover on NASDAQ, but as you can see the short selling against these stocks has increased as of mid-June despite the high energy costs. Here we ran the short interest for our main names in solar power NASDAQ such as First Solar, Inc. (NASDAQL FSLR), SunPower Corporation (NASDAQ: SPWR), Evergreen Solar Inc. (NASDAQ: ESLR), Canadian Solar Inc. (NASDAQ: CSIQ), Akeena Solar Inc. (NASDAQ: AKNS), and Hoku Scientific, Inc. (NASDAQ: HOKU).
We broke these down by the stock with the date and we showed a comparison of both the May 30 date and what the related changes were at that date as well.
First Solar, Inc. (NASDAQ: FSLR)
AS OF DATE Short Int. Change
06/13/2008 4,183,584 20.16%
05/30/2008 3,481,565 -1.03%
SunPower Corporation (NASDAQ: SPWR)
AS OF DATE Short Int. Change
06/13/2008 16,804,676 6.46%
05/30/2008 15,784,486 3.63%
Evergreen Solar Inc. (NASDAQ: ESLR)
AS OF DATE Short Int. Change
06/13/2008 29,219,334 20.92%
05/30/2008 24,164,046 9.23%
Canadian Solar Inc. (NASDAQ: CSIQ)
AS OF DATE Short Int. Change
06/13/2008 4,634,187 8.23%
05/30/2008 4,281,924 -0.68%
Akeena Solar Inc. (NASDAQ: AKNS)
AS OF DATE Short Int. Change
06/13/2008 3,718,884 10.32%
05/30/2008 3,371,093 2.77%
Hoku Scientific, Inc. (NASDAQ: HOKU)
AS OF DATE Short Int. Change
06/13/2008 3,031,978 10.80%
05/30/2008 2,736,325 -19.45%
Jon C. Ogg
June 25, 2008
Pre-Market Stock News (January 23, 2008)
We are full fledged into earnings season now, so most news coverage will point to the current earnings environment and guidance. There are of course drug developments and other contracts awards. Below is a snapshot of some of the key data we saw affecting shares in pre-market trading:
- Abbott Laboratories (ABT) $0.93 EPS versus $0.92 estimate; sees Q1 EPS $0.61 to $0.63 versus $0.65 estimates and sees 2008 EPS $3.20 to $3.25 versus $3.22 estimate.
- Advanced Energy Industries Inc. (NASDAQ: AEIS) traded down over 10% after after it lowered guidance.
- Air Products (APD) $1.16 EPS vs $1.13 estimates.
- Apple Inc. (AAPL) trading down 10% after it posted $1.76 EPS on $9.6 Billion revenues; Estimates were $1.62 EPS on revenues of $9.47 Billion; Guidance for next quarter is $0.94 EPS and revenues $6.8 Billion versus estimates of $1.09 EPS on $6.98 Billion in revenues.
- Baidu.com (BIDU) announces the formal launch of its Japanese language search engine run by its Japanese subsidiary.
- CheckPoint Software (CHKP) trading up almost 5% after $0.46 EPS versus $0.45 est.; Revenues $206.7M vs. $202.3M est.;
- CNH Global (CNH) $0.50 EPS versus $0.60 estimate.
- Coach (COH) $0.69 EPS vs $0.68 estimate; noted weak mall traffic and decline in average transaction size.
- EntreMed (ENMD) is starting its Phase II study with its MKC-1 cell cycle inhibitor in ovarian cancer and advanced endometrial cancer.
- Ethan Allen (ETH) posted $0.70 EPS versus $0.68 estimate.
- Foster Wheeler (FWLT) trades ex-split to reflect a 2 for 1 stock split.
- General Dynamics (GD) $1.42 EPS vs. $1.41 estimate; sees 2008 EPS $5.55 to $5.65 versus $5.73 estimate.
- HOKU Scientific Inc. (HOKU) traded down 10% after earnings beat but guidance was deemed light.
- INX (INXI) awarded Department of Defense contract to provide up to $21 million in support of a Cisco Systems network pact.
- Martek Biosciences (MATK) noted a December publication showed its DHA may help in late-onset Alzheimer’s, although NIH study results will be in 2010.
- Parametric (PMTC) $0.26 EPS vs. $0.23 estimate; sees next quarter $0.24 to $0.28 vs. $0.26 estimate; sees 2008 EPS $1.17 to $1.27 vs. $1.16 estimate (revenue in-line).
- Praxair (PX) $0.98 EPS vs $0.97 estimate.
- Qualcomm (QCOM) expanded relationship with Motorola for chipsets into certain UMTS 3G handsets in 2008 and 2009.
- RLI Corp. (RLI) $1.22 EPS versus $1.05 estimate.
- Rockwell Automation (ROK) $1.04 EPS vs. $1.01 estimates; guides 200 EPS $4.25 to $4.45 versus $4.38 estimate.
- Southwest Airlines (LUV) $0.12 EPS vs. $0.10 estimate ; reigned in 2008 growth plans to 4%-5% capacity.
- Texas Instruments Inc. (TXN) has posted earnings of $0.54 EPS and revenues of $3.56 Billion; analysts pegged at $0.52 EPS on $3.58 Billion in revenues; sees Next quarter $0.43 to $0.49 EPS on revenues of $3.27 to $3.55 Billion versus estimates of $0.45 EPS on $3.41 Billion in revenues.
- TJX Companies (TJX) was Jim Cramer’s retail pick on CNBC’s MAD MONEY last night.
- United Tech (UTX) $1.08 EPS vs. $1.06 estimate; sees 2008 $4.65 to $4.85 versus $4.85 estimate.
- Vertex Pharmaceuticals (VRTX) will begin Phase III evaluation of telaprevir for its lead investigational hepatitis C protease inhibitor.
- WellPoint (WLP) $1.51 EPS versus $1.51 estimate.
- Werner Enterprises (WERN) $0.28 EPS vs. $0.28 estimate.
Jon C. Ogg
January 23, 2008
Hoku Disconnect: Past Earnings Versus Potential Operations (HOKU)
HOKU Scientific Inc. (NASDAQ: HOKU) reported a Q3 non-GAAP loss of -$0.01 per share, which is better than the First Call consensus of estimate of -$0.10 and revenues rose 15.0% from last year to $1.3 million versus the $1.1 million consensus estimate. The focus seems to be on the company’s guidance for next quarter with $0.6 to $1.2 million versus $1.35 million consensus. We frankly aren’t concerned with these small contracts from the last quarter nor over the last year as this company trying to make a major expansion into a true materials supplier.
HOKU said it expects to see some volatility in quarterly earnings as they implement polysilicon strategies. The company is being treated as though it beat earnings and beat revenues compared to estimates; but the verdict is that the company guided Q4 revenues below consensus estimates. This may even be partly because of the interpretation that the Associated Press published. They are entitled to their own opinion and can publish as they see fit, but we’d note here that all of these past revenues are almost entirely irrelevant to the future business model once this Idaho polysilicon plant is up and running (assuming it will).
There is still a disconnect between the bulls and bears in Hoku based upon what the company will look like soon versus those that are looking at Hoku’s trailing results for inference into its ability to have a bright future. This is why we have given a "both sides of the coin" to show both.
Hoku Scientific Financing Brings Hope & Plans Closer to Fruition (HOKU)
After the close of trading on Wednesday, Hoku Scientific, Inc. (NASDAQ: HOKU) announced that it signed a non-binding term sheet with Merrill Lynch (NYSE:MER) to borrow up to roughly $185 million for the construction, procurement and start-up of its planned polysilicon production plant in Pocatello, Idaho.
The closing of the loan and the availability of the funds is subject to several conditions:
- completion by Merrill Lynch of its due diligence,
- negotiation and execution of definitive loan and collateral documents,
- and the receipt of third-party consents.
Hoku Scientific will also be required to provide its Hoku Materials unit with approximately $35 million in cash for use in the construction of the planned polysilicon plant. To meet this and other capital requirements, Hoku Scientific will be required to secure additional financing.
The Idaho facility is expected to produce approximately 2,500 metric tons of polysilicon per year, and the first customer shipments are planned for the beginning of 2009. Hoku just recently announced its Phase II of its planned polysilicon facilities to increase its capacity beyond 2,500 metric tons per year.
This non-binding term sheet will expire on the earlier of the termination of negotiations between the parties or May 31, 2008 and there may be additional material closing conditions required. So this is not a 100% done and completed deal, but if all goes well the company has gotten more of its hopes and plans that much closer to fruition.
Jon C. Ogg
December 6, 2007
Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.
Pre-Market Stock News (December 6, 2007)
Below is some of the top pre-market news affecting individual shares that 247WallSt.com is reviewing:
- AMERCO (NASDAQ: UHAL) announce a $50 million share buyback plan.
- Children’s Place Retail Stores (NASDAQ: PLCE) NOV s-s-s were +3%.
- Coca-Cola (NYSE: KO) announced its CEO succession plan, Kent will replace Isdell in July 2008.
- Costco (NASDAQ: COST) same-store sales rose 9%. Analysts had expected 6.6%.
- Eli Lilly (NYSE: LLY) put 2008 EPS guidance at $3.85-4.00, slightly above consensus.
- Family Dollar (NYSE: FDO) issued downside guidance with same-store-sales.
- Freeport-McMoRan (NYSE: FCX) was noted as Cramer’s Top Mining & Minerals stock on MAD MONEY.
- GameStop Corp. (NYSE:GME) will replace Dow Jones (NYSE:DJ) in the S&P 500 Index on date TBA.
- Hoku Scientific (NASDAQ: HOKU) shares trading up 35% after it signed a term sheet for financing its Polysilicon Plant in Idaho with $185 million.
- Limited Brands (NYSE: LTD) NOV s-s-s -7%.
- Pacific Sunwear (NASDAQ: PSUN) NOV s-s-s +2.3%.
- Rambus (NASDAQ: RMBS) rose 1.7% to $20.19 as SEC dropped options investigation with no action recommended.
- Sierra Pacific (NYSE: SRP) filed to sell 12 million shares in a secondary.
- Toll Brothers (NYSE: TOL) reported its first quarterly loss in two decades; EPS were -$0.52 versus -$0.47 estimates.
- VF Corp. (NYSE: VFC) noted as Buy by Cramer on MAD MONEY.
Jon C. Ogg
December 6, 2007
Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.
The Business Day In Global Warming (MDR, GOOG, FTEK, GFET, ACPW, HPQ, YGE, GLW, HOKU, SOLF, HMC, CPST)
McDermott (NYSE:MDR) realigned its its B&W into 4 units, mostly aspects of nuclear but it also is focusing on cleaner coal and carbon capture.
Google (NASDAQ:GOOG) is going greener than green with a new business venture… in alternative energy generation and a search to eliminate carbon from coal. As Google’s initiative is aimed at eliminating and lowering coal use emissions, one key player there (that was not mentioned at all) is Fuel Tech Inc. (NASDAQ:FTEK) and it has been beaten up lately.
Gulf Ethanol (OTC-BB:GFET), which you have likely seen advertised all over the internet, licensed a ‘breakthrough technology" in an agreement to acquire the exclusive rights to a cellulose feed-stock processing technology and will have the exclusive right to deliver this new technology solution to the ethanol industry.
Active Power, Inc. (NASDAQ:ACPW) announced its CleanSource UPS (uninterruptible power supply) system was awarded the 2007 Product Design Innovation of the Year by the Institution of Engineering and Technology….noise rather than financial news.
Hewlett-Packard (NYSE:HPQ) announced relationships with two renewable energy providers, SunPower Corp. in the U.S. and Airtricity in Ireland, as part of the company’s strategy to reduce its global carbon footprint. HP will install its first-ever, large-scale solar power installation at its San Diego facility. And now it will ensure that nearly 90 percent of HP’s energy use in Ireland is renewable, exceeding the company’s 2007 target for carbon emission reductions.
Yingli Green Energy Holding Company Limited (NYSE:YGE) announced it has signed three polysilicon contracts with a leading polysilicon manufacturer to produce over 40 MW of PV modules over the life of the contracts.
Last night, Corning Incorporated (NYSE: GLW) completed expansion of its clean-air products facility, Corning Shanghai Company, Ltd. in Shanghai, China. The additional capacity will help Corning to increase its manufacturing capabilities to meet anticipated local and global demand for advanced ceramic substrates for light-duty vehicle applications.
Yesterday, Hoku Scientific (NASDAQ:HOKU) rose sharply by 38% after signing a Phase II $306 million polysilicon supply pact spread over 8-years with Solarfun (NASDAQ:SOLF).
It’s been a while, but Honda Motors (NYSE:HMC) has gotten a significant amount of attention after the announced launch of the Fuel Cell car, its FCX Clarity. We gave a review of how investors should view this with an explanation as to why. It’s definitely a different take than you’d expect and we show the others in the sector too.
In another note, we recently featured Capstone Turbine (NASDAQ:CPST) on our "10 Stocks Under $10" subscriber letter. We feel the aggressive target where Lazard Capital Markets called for it to essentially double may end up being quite conservative.
To set your RSS feeds to out "Business Day in Global Warming" set your feed to the following URL:
http://www.247wallst.com/alternative_energy/index.html
Jon C. Ogg
November 27, 2008
24/7 Wall St. also has its open email distribution list where we cover IPO’s, merger arbitrage, small cap stocks, reorganizations, upcoming events, and other special situations.
As a reminder, whether you prefer the term "Global Warming" or "Climate Change" is not the issue as far as 24/7 Wall St. covers it. Green business has become big business, and this affects many public companies today.
Hoku Shares Surge On Another Supply Award (HOKU, SOLF)
Shares of Hoku Scientific Inc. (NASDAQ:HOKU) are surging pre-market. The provider of clean energy products and technologies including polysilicon for the solar industry has announced that Solarfun Power Holdings’ (NASDAQ:SOLF) Hong Kong unit signed a definitive contract for Hoku’s sale and delivery of polysilicon to Solarfun over an eight-year period beginning in mid-2009.
The deal is subject to deliveries and conditions, but it is valued up to approximately $306 million payable to Hoku during the eight-year period. The deal is set to start in the second half of 2009 at set prices that will decline throughout the eight-year period. Here are the additional terms in the press release:
- Initial deposit of $10 million to Hoku on or before December 28, 2007, and requires that Solarfun make additional prepayments for products in the aggregate amount of $45, which are to be paid to Hoku in three installments: the first payment is due on September 30, 2008, and the final payment is due on March 31, 2010.
- The $45 million prepayment amount is to be placed in an escrow account by Solarfun, or secured by a letter of credit from Solarfun’s bank, on or before January 10, 2008.
- Under the agreement, Hoku will grant to Solarfun a security interest in its polysilicon assets to secure Hoku’s obligation to repay $55 million to Solarfun as a credit against product shipments over time.
This is what Hoku is calling "the first order accepted for Phase II of its polysilicon business." Hoku’s previously announced customers include SANYO Electric Co., Ltd., Suntech Power Holdings Co., Ltd., Global Expertise Wafer Division Ltd., and now Solarfun. Collectively, these buyers have agreed to purchase approximately $1.5 billion in polysilicon over a seven to ten year period from the completion of its factory build-out.
Hoku shares are up some 40% pre-market at $8.30, and the the 52-week trading range is $2.52 to $14.55. Before today’s 40% gain pre-market its market cap was roughly $100 million.
Previously, we gave a "Both Sides of the Coin" review of Hoku Scientific as a highly speculative stock as a future materials supplier to the solar sector.
Jon C. Ogg
November 26, 2007
The Business Day In Global Warming (XEL, FTEK, AIG, SYNM, AKNS, USBE, DASTY, CLNE, DSTI, FSLR, HOKU, PBW, GEX)
Xcel Energy’s (NYSE:XEL) 345-kilovolt transmission line along with two major 115 kV lines will deliver the power into the Minnesota High voltage transmission grid allowing delivery of the power from the Fenton Wind farm and other wind power resources from the Buffalo Ridge region of the state into the twin Cities area. Minnesota’s largest wind farm and the state’s largest transmission line built to carry wind power into the Twin Cities were dedicated today and will soon become fully operational. The only thing between the Twin Cities and the North Pole is a picket fence and it blew down.
Fuel Tech, Inc. (Nasdaq: FTEK) announced receipt of a FUEL CHEM® demonstration order from a new electric utility customer in the Midwestern United States on a large Powder River Basin coal-fired boiler, with chemical feed scheduled to commence later this quarter. Unfortunately for the company shareholders, shares slid nearly 3% to $24.39 after a miserable day yesterday.
Jim Cramer recently gave a large summary of his stock picks that would win from the move to a greener U.S., although some are far from "green" companies.
Hoku Production Award (HOKU, SGR)
Hoku Scientific, Inc. (NASDAQ:HOKU) has announced that its Hoku Materials subsidiary entered into an Engineering Services & Technology Transfer Agreement for Dynamic Engineering to provide design and engineering services, and a technology license, for Hoku Materials to build a trichlorosilane production and purification unit at its planned polysilicon production plant in Pocatello, Idaho.
The agreement announced today provides for Dynamic to provide the basic engineering package and related services for the TCS production component of Hoku’s planned polysilicon plant, which will be integrated by Stone & Webster Inc., a subsidiary of The Shaw Group Inc. (NYSE:SGR), and Hoku’s engineering, procurement and construction management firm, into the overall polysilicon production facility, and will be constructed by JH Kelly, Hoku’s general construction contractor.
Shares are up over 15% in early pre-market trading at $10.60 on the headlines despite no terms being disclosed. The 52-week trading range is $2.52 to $14.55. Other items of interest in HOKU:
- We gave a ‘both sides of the coin’ read on Hoku;
- Showed how painful the market malaise was for cult stocks;
Jon Ogg
October 9, 2007
Jon Ogg produces the "Special Situation Investing Newsletter" and he does not own securities in the companies he covers.
Pre-Market Analyst Calls (September 4, 2007)
ABY raised to Neutral at UBS.
AMD raised to neutral at Credit Suisse.
AG raised to neutral at Credit Suisse.
AEO raised to Outperform at Cowen.
BLOG started as Outperform at Wachovia.
DVA raised to Buy at Deutsche Bank.
EXEL cut to Mkt Perform at Wachovia.
FCSX raised to BUy at B of A.
HOKU raised to Mkt Perform at Piper Jaffray.
HSII cut to Sell at UBS.
INFA started as Outperform at CIBC.
KFN cut to Sell at UBS.
KOP cut to Hold at Jefferies.
KPN cut to Hold at Citigroup.
KSU raised to Buy at UBS.
MNST cut to Neutral at UBS.
MXIM started as Outperform at RBC Capital.
OII started as Overweight at JPMorgan.
OTE cut to Peer Perform at Bear Stearns.
PCG raised to Overweight at Lehman.
RDS/A raised to Buy at UBS.
RHI cut to Neutral at UBS.
RIMM cut to Peeer Perform at Bear Stearns.
SMOD cut to Hold at Citigroup.
SPR started as Overweight at Lehman.
TEF cut to Hold at Citigroup.
TMA raised to Outperform at FBR.
TYC raised to Buy at Deutsche Bank.
TYPE started as Buy at B of A.
TYPE started as Buy at Jefferies.
WEC raised to Overweight at Lehman.
Jon C. Ogg
September 4, 2007
Recent Market Malaise Extra Painful For Cult Stocks (CMGI, SFE, HOKU, LOCM, OMEX)
When you see close to a 10% drop in the broad market, you just automatically assume it punishes the speculative names even worse. Being Hi-Beta has a price. That wasn’t any different in the last mini-tank. Many of these companies essentially have not had any real official change to their underlying stories. But we all know that the ’story’ is dependent upon good times lasting for many quarters or longer.
This last drop has been extremely tough on many of these speculative and ‘cult stocks’ over the last couple of weeks. Here are a just a few of the instances in some of the more cult stock names we cover from time to time:
CMGI Inc. (NASDAQ:CMGI) is actually less than 10% above its 52-week lows of $1.20 now. At $1.36 it is down almost 50% from the $2.60 highs. This was a major cult stock for the first half of the year. If the capital markets are closing it may crimp its wave of investing into recent alternative energy companies. That argument seems flawed, and the ModusLink story has still been receiving coverage. Here was what we The story didn’t seem like it has changed at all, but it is obviously not at all immune to a market tank nor to a softening economy and any tightening liquidity crunch isn’t going to be well received by CMGI speculators.
Safeguard Scientifics (NYSE:SFE) traded as high as $3.28 at the end of April, and shares sit at $2.00 mid-day. Safeguard traded up after such a large move earlier this year at CMGI. We interviewed the CEO at the end of June. Maybe their own capital hasn’t dried up for investing, but partners may have a harder time pulling the trigger now.
Local.com (NASDAQ:LOCM) also saw shares skyrocket on a patent award and on other business developments, but even on the 2+% post-earnings gain today shares have fallen more than 50% from highs in July.
Hoku Scientific Inc. (NASDAQ:HOKU) is still up nearly 300% from lows, but it has been shares in recent weeks fall from highs of over $14.00 down to just under $8.00 today. Its pending contracts have been viewed with less certainty over the future financing of its polysilicon factory under plans in Idaho. That is the logic behind the slide any way. We gave a "both sides of the coin" picture on this back in June, and right now it’s on tails.
Odyssey Marine (NASDAQ:OMEX), formerly OMR on AMEX, shares are higher after it filed amended complaints against Spain after Spain wants its treasure back for free that it lost in shipwrecks and after a recent brief company boat seizure and data copied from one of the laptops on board. This was the story that got Odyssey back on the map, no pun intended.
Obviously there are many names out there that have been given a hard market slap. A 7% drop in the DJIA has equated to a 7% drop in the NASDAQ. All eyes are on the FOMC today, although with a liquidity and a housing market at serious risk Bernanke & Co. probably have more on their mind besides small cap speculative stocks.
In really tough times that won’t have major buyouts and times where investors may not be able to count on share buyback plans to add a floor, investors look at defensive stocks. Here was our revised ‘bulletproof stock list’ from last week. Just keep in mind that if a market stays tough, even the teflon stocks fall victime to the firing squad.
Jon C. Ogg
August 7, 2007
Jon Ogg can be reached at jonogg@247wallst.com; he does not own securities in the companies he covers.
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Today’s top tickerspy Indexes Home Furnishing R... +14.1% Ethanol and Biofu... +5.1% Electronics Retai... +2.1% Diabetes Stocks +2.0% Memory Chip Stock... +2.0% 
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